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Good news for Indiana’s economy: The state grew by just more than 44,000 residents in 2024, achieving its largest population growth since 2008, according to an analysis by the Indiana Business Research Center.
Population growth matters given the correlation between economic growth and a growing population. States experiencing the strongest population growth are also experiencing higher GDP growth (e.g., Florida, Texas, Tennessee). When a state’s population grows, there are more workers available, which in turn attracts industries. And the flywheel continues as a growing economy attracts more talent, including young people who bring vitality to communities as they start and raise families. The increase in economic growth translates into more tax revenue to help fund infrastructure, education and government services.
Indiana’s 2024 growth rate of 0.64% was better than every surrounding state except for Kentucky, which grew 0.83% (Michigan, 0.57%; Illinois, 0.54%; Ohio, – 0.5%).
The IBRC analysis has more good news: Rural Indiana experienced growth for the second year in a row, with 17 of the 23 rural counties designated rural adding residents. While the growth rate of these counties is low, at 0.2%, any growth is welcome news given the decline that rural counties experienced from 2010-2020.
Hamilton County continues to lead the way in growth, with 7,116 new residents. Marion County experienced its best growth since 2018, adding 5,974 residents. And Allen County, driven by growth in Fort Wayne, added 4,164. When measured by rate, Boone County grew the fastest, at 3.4%, followed by Hancock (3.1%), Hamilton (1.9%), Hendricks (1.9%), Clark (1.4%) and Johnson (1.4%).
The Indy metro area, which comprises 11 counties and 31% of the state’s population (2.17 million people), accounted for 60% of the state’s net growth. Indy metro’s growth rate of 1.24% exceeded peer metro growth rates in surrounding states, excluding Columbus, Ohio, which grew at 1.38%. Louisville grew at 1.2%; Cincinnati, 0.88%; Chicago, 0.76%; Detroit, 0.71%; and Cleveland, 0.26%.
But the headline-grabbing statistic is that international immigration accounted for 70% of Indiana’s growth last year. When Indiana experienced similar growth back in 2008, 77% of that was driven by the Hoosier birthrate’s exceeding the death rate. Today, birth rates are declining, not just in Indiana but nationally. The combination of declining fertility rates, rising death rates as baby boomers age and more restrictive immigration policies translates into slowing population growth rates in the 2030s, according to The Pew Charitable Trusts’ Fiscal 50 Project.
Given Indiana’s reliance on immigration for population growth and the strong likelihood that immigration to the United States will decline in the coming years, Indiana must ramp up efforts to attract talent from other states, retain graduates from our universities and ensure that Indiana is attracting more than our fair share of immigrants.
Further investments in our cities—including infrastructure, education and entertainment options—will help attract and retain talent. Indy’s redevelopment of Circle Centre Mall, investments by Indiana University and Purdue University in Indy and the Indiana University Health investments in a developing health care corridor all should help efforts to grow our capital city.
State budgets and future investments will suffer if we do not attract younger workers to replace our aging population. More bold thinking and action are necessary to ensure Indiana’s prosperity. Send me your ideas to attract and retain talent, and I’ll dedicate a future column to those ideas.•
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Feltman is publisher of IBJ and CEO of IBJ Media. Send comments to [email protected].
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